Clarins passes $1bn sales and appoints new vice president

By Guy Montague-Jones

- Last updated on GMT

Related tags Cent United states dollar Vice president of the united states

Luxury cosmetics group Clarins has exceeded its full year sales
expectations reporting turnover in excess of €1bn for the first
time despite losing business in the US.

Sales rose 7.3 per cent at constant exchange rates to €1.007bn - an increase above the 6 per cent that the company predicted in its guidance for the year.

However, the strength of the Euro adversely affected the French company's turnover so that at average exchange rates full year sales rose by only 4.2 per cent Reflecting the subdued economic environment sales for the fourth quarter rose by 5.2 per cent compared to double digit increases for the previous two quarters.

While full annual results will be published on 19 March Clarins indicated that earnings in the second half of the year were higher than the first as a result of better than expected sales figures in the last six months.

Nonetheless, sales were boosted by higher marketing expenses which depressed the company's operating margin during the first half of the year by 2.9 per cent.

Performance by segment Breaking down the full year sales figures, beauty outperformed perfume as the France-based company reported sales increases for the two of 5.4 per cent and 4.8 per cent respectively.

Make-up was a particularly strong performer in the beauty segement with sales increasing by 29.4 per cent on the back of successful launches.

The eye range was highly successful in this category as the popularity of Colour Quartet for Eyes and the new Mascara Wonder Length helped sales jump 53.6 per cent.

Meanwhile, the perfume business was supported by the success of the Azzaro and Thierry Mugler brands - the latter's sales rose 7.8 per cent despite the absence of any major launches.

Performance by region

When the sales figures are broken down by geographical region a great deal of variation is apparent.

North American sales fell by 1 per cent at constant exchange rates and 8.2 per cent at average exchange rates reflecting unsuccessful launches compounded by the weakness of the dollar and strength of the Euro.

The strength of the Euro also came into play when looking at Asian sales, which rose by 12.5 per cent at constant exchange rates and only 3.5 percent at average exchange rates.

Performance in Europe, which accounts for over 60 per cent of total turnover, was strong with sales rising 5.8 per cent at constant exchange rates.

Sales in other countries rose 35.6 per cent following substantial gains in the Middle East and Latin America.

New vice president Alongside the financial results Clarins announced the appointment of Philip Shearer as executive vice president.

Shearer, who will join the company in March, was previously the group president at Estee Lauder, where he was responsible for the online business as well as a portfolio of leading brands including Clinique and Aveda.

"Shearer is a respected leader in our industry and his contribution to our group's management team will enable us to pursue our expansion," said Clarin's chairman Christian Courtin-Clarins.

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